Geopolitical changes impact programmes & budget

The Commission reviewed 2022 R&I activities and proposes a reinforced budget to cope with new geopolitical realities. ERAC discussed ERA implementation.

On 31 May, the EC published the annual report on ‘Research and Technological Development Activities of the European Union and Monitoring of Horizon Europe and Horizon 2020 in 2022’. The report summarises key R&I activities and developments in the past year and includes overviews on policy developments as well as on the implementation and monitoring of the R&I Framework Programmes. The document highlights key drivers and focus areas in 2022: “Russia’s war against Ukraine and the increased frequency of climate-related extreme events have made it even more urgent for the EU to transition to a fair green and digital society”. Furthermore, the EC points out that so far, the success rate of proposals is higher for Horizon Europe (15.9%) than for Horizon 2020 (11.9%). However, 71% of high-quality proposals are not receiving funding, with 10.6% put on a reserve list. The EC concludes that “an additional amount of approximatively €34.4 billion would have been needed to fund all high-quality proposals”.

The geopolitical developments also influenced the European Commission’s (EC) proposal of 20 June to reinforce the EU’s long-term budget in reaction to the new challenges. The EU’s Multiannual Financial Framework 2021-2027, which is also funding the current EU programme generation, was agreed in 2020 (see SwissCore article). Together with the NextGenerationEU recovery instrument, it amounts to €2.018 trillion in current prices. In the meantime, Russia’s invasion of Ukraine had already significant humanitarian, economic and budgetary consequences for the EU. Thus, the EC’s proposal focuses, to a large extent, on support for Ukraine. A respective facility with an overall capacity of €50 billion for 2024-2027 would cover Ukraine’s immediate needs as well as recovery and modernisation efforts to support its path towards EU membership. EU internal and external dimensions of migration arising from the global consequences of the war would be addressed with €15 billion.

The Commission also put forward a proposal for a Strategic Technologies for Europe Platform (STEP) to promote the EU’s long-term competitiveness on critical technologies, in the fields of digital and deep tech, clean tech and biotech (see SwissCore article). To deploy these efforts quickly, STEP tops up existing instruments, including InvestEU, the Innovation Fund, the European Innovation Council (EIC) and the European Defence Fund, to allow for more support in scaling up SMEs. Furthermore, the EC budget proposal includes a mechanism to cater for the higher NextGenerationEU funding costs due to the surge in interest rates. A new ‘EURI Instrument’ will cover the additional costs since the original projections of 2020. As the budgetary consequences will already materialise in 2024, the EC hopes that the budget proposal can be approved swiftly by the EU Parliament and the Council during the Spanish Presidency, which covers the second half of 2023 and starts on 1 July.

On 21 and 22 June, the European Research Area and Innovation Committee (ERAC) met in Lund to discuss the European Research Area (ERA) Policy Agenda and the EU’s Global Approach to R&I collaboration (see ERA Portal Austria article). The delegations discussed the ‘National implementation of the ERA Policy Agenda 2022-2024: State of play with regard to national policy vehicles’, drafted by the German delegation. The analysis assesses the state of play with regard to the implementation of the ERA Policy Agenda 2022-2024 at the national and regional levels. The survey carried out among Member States and Associated Countries shows that out of 28 responses, 7 countries have a dedicated national action plan in place (Austria, Flanders in Belgium) or plan to set up a plan in the nearest future (Belgium, Croatia, Estonia, Germany, and Norway). 12 countries indicated that their ERA implementation is an integral part of a broader national research and innovation strategy, as mentioned by Cyprus, Estonia, Germany, Greece, Hungary, Ireland, Slovakia, and Slovenia, and -or – a national smart specialisation strategy, as indicated by Croatia, Cyprus, Czech Republic, Greece, Ireland, Hungary, Slovenia, and Spain. 17 of the respondents apply a case-by-case approach for the ERA Policy Agenda 2022-2024. During the ERAC Meeting, Member States were in favour of continuing the flexible approach to national implementation – and of a reduction of the number of ERA actions.

On 28 June, EC President Ursula von der Leyen informed that she decided to propose to the Council and the European Parliament the appointment of Ms Iliana Ivanova, one of the two candidates put forward by the Bulgarian government, for the post of Commissioner. Once confirmed, Iliana Ivanova will be in charge of Innovation, Research, Culture, Education and Youth, following on Mariya Gabriel, who left the EC on 15 May to join the Bulgarian government. Iliana Ivanova has significant experience at the EU level, having been a member of the European Court of Auditors since 2013. Between 2009 and 2012, she was a member of the European Parliament and a vice chair of the Committee on budgetary control.

On 21 June, the Swiss government, the Federal Council, reviewed the current situation regarding European policy and adopted the parameters for a negotiating mandate with the EU on a new package approach for the relations between Switzerland and the EU. The Federal Council plans to decide about a possible mandate for negotiations with the EU towards the end of 2023. Switzerland’s association to Horizon Europe will depend on progress on the new package approach that envisions to update existing and create new agreements with the EU.